How Much Commission Do OTAs Actually Take From Hotels?

If you run an independent hotel, you probably already know that Booking.com, Expedia, Airbnb, and other OTAs take a commission from each reservation. The part that’s easier to overlook is what that commission means over an entire year.

A 15%, 18%, or 20% commission can look relatively small when you’re looking at one reservation. When a large share of your annual room revenue comes through OTAs, though, that number can become one of the largest costs associated with your entire distribution strategy. That’s why it’s worth stepping back from the percentage on a single booking and calculating what OTA commission actually costs your property.

The answer isn’t necessarily to stop using OTAs. For most independent hotels, they remain an important source of demand. The more useful question is how much of that demand could eventually come through your own website instead.

A few terms come up throughout this piece, so in plain terms:

What OTAs charge

There’s no single OTA commission rate that applies to every hotel. What a property actually pays depends on the platform, the market, the property type, the commercial agreement in place, and sometimes the visibility programs the property participates in.

For independent hotels, 15-25% is a useful general range for thinking about Booking.com and Expedia commissions, though individual properties can pay less or more than that. Airbnb uses a somewhat different fee structure - under its host-only model, many hosts pay around 15.5%, with the overall fee generally falling in the 14-16% range depending on circumstances.

Platform	Typical range
Booking.com	15-25%
Expedia	15-25%
Airbnb (host-only fee)	14-16%, commonly around 15.5%

These figures are useful as planning assumptions, but they shouldn’t be treated as a quote for your particular property. The only number that really matters for your business is the commission rate you’re actually paying, and the only way to know that is to look at your own statements.

There’s an important comparison worth making alongside those ranges. The cost of a direct booking is normally much lower. A hotel still has payment-processing costs, a booking-engine cost, and the cost of maintaining its website and booking infrastructure, but those costs are generally well below a 15-25% OTA commission. EHL Insights, for example, estimates the cost of a direct booking at around 4.5% once payment processing and booking-engine costs are factored in.

That difference is the reason direct bookings are financially interesting - but it doesn’t mean every OTA booking should be replaced with a direct one. An OTA may have introduced the guest to the property in the first place. Without that OTA, the booking might not have happened at all. The question worth asking isn’t “how do we avoid OTA commission,” it’s what happens when a guest who’s already willing to book your hotel chooses the OTA instead of your website.

What that costs in real numbers

The easiest way to understand OTA commission is to put it against actual room revenue. Imagine a 20-room independent hotel generating $600,000 a year in room revenue from OTAs. If the hotel’s blended OTA commission is 18%, the calculation is straightforward: $600,000 x 18% = $108,000. That means the property is paying approximately $108,000 a year in OTA commission - an average of $9,000 a month, and $540,000 over five years at the same revenue and rate.

Real hotels don’t operate that consistently, of course. Revenue changes year to year, commission rates change, the share of bookings coming from OTAs changes, and a property may use several OTAs with different commercial terms. So this isn’t a prediction of what a 20-room hotel should pay - it’s simply an example of how quickly the number becomes meaningful once you apply the percentage to actual revenue.

You can run the same calculation with your own numbers: take the room revenue generated through OTAs over the last 12 months and multiply it by your approximate blended commission rate. $400,000 in OTA revenue at 18% is $72,000. $800,000 at 20% is $160,000. Once you see the annual figure, the question of direct bookings becomes much easier to evaluate, because you can compare the cost of acquiring a direct booking against the cost of acquiring the same booking through an OTA.

Beyond the commission percentage

Looking only at the commission percentage can make the discussion too simple in both directions - too alarming, and also too easy to write off as unavoidable.

It’s not free money you’re losing

An OTA does more than process the reservation. It provides a marketplace where travelers discover properties they might never have found otherwise, and it invests in advertising, search visibility, technology, payment infrastructure, customer support, and the booking experience itself. For an independent hotel without a large marketing operation, that distribution can be genuinely valuable - which is why it’s not particularly useful to describe the entire commission line as money the hotel is simply losing.

The more useful distinction is between incremental OTA demand and bookings that could reasonably have been direct. If an OTA introduces a new guest to your property who would otherwise have stayed somewhere else, the commission is a reasonable acquisition cost. If a guest searches specifically for your hotel, visits your website, and then books the same room through the OTA because the OTA’s site is easier to use, the economics look very different. That gap is where improving the direct channel gets interesting.

The guest relationship is part of the cost

When someone books directly, the hotel controls the booking experience and can generally build a stronger first-party relationship with that guest. With an OTA booking, the hotel gets what it needs to manage the reservation, but the OTA remains an important part of the guest relationship, including after the stay. A hotel that generates a large share of direct bookings has more opportunities to build its own guest database, encourage repeat visits, and communicate directly with past guests. A hotel that generates most of its bookings through OTAs has less of that.

There’s also a visibility question. When a hotel depends heavily on one OTA, changes to that platform’s ranking system, commercial programs, or policies can noticeably affect bookings - the hotel is effectively outsourcing part of its distribution to a company whose priorities it doesn’t control. That doesn’t make the OTA a bad partner. It just means relying on one channel creates a business risk that a blended channel mix doesn’t.

Rate parity complicates the comparison

Hotels have historically had rate-parity obligations and other commercial restrictions tied to OTA distribution. The exact rules depend on the market and the agreement, and the regulatory environment has also shifted in different regions over time. In practice, this means a hotel can’t always solve the direct-booking problem by simply putting a lower rate on its own website.

The direct channel needs to compete in other ways: a direct-booking benefit, more flexible cancellation terms, an included service, a loyalty perk, or just a genuinely better and more convenient booking experience. The guest needs a reason to book directly. If the hotel website offers the same information, the same price, and a clunkier booking flow than the OTA, there’s little reason for the guest to change their behavior.

OTAs aren’t the enemy

It’s tempting to look at a $100,000 annual commission bill and conclude the obvious answer is to stop using OTAs. For most independent hotels, that would be the wrong conclusion. OTAs provide demand that’s difficult for many individual properties to replicate on their own, and they give travelers a familiar place to compare hotels that can introduce a property to guests who’d otherwise never find it.

The problem isn’t the existence of OTAs. The problem is dependence. If 80% or 90% of your bookings come through third-party channels, your hotel has relatively little control over its own distribution - a change in commission, ranking, visibility, or platform policy can suddenly become a problem for the whole business. A healthier situation is usually a mix of channels, where OTAs keep bringing new demand while the hotel’s own website gets better at converting guests who are already interested in the property. That’s a far more realistic goal than trying to eliminate OTA bookings altogether.

So the better question isn’t “how do we get rid of OTAs,” it’s how many of your current OTA bookings could realistically become direct bookings. Suppose your hotel generates $600,000 in OTA revenue at an 18% commission - $108,000 a year. If you could move even 20% of that revenue to the direct channel, that’s $120,000 of room revenue shifting away from the OTA, which at the same 18% commission represents roughly $21,600 in annual commission that would no longer be paid on those bookings.

The direct channel has its own costs, so that whole $21,600 isn’t pure profit. But it gives you a number you can weigh against the cost of improving your website, booking engine, SEO, and direct-booking campaigns - a more useful business calculation than simply saying OTAs charge “too much.”

Commission is also only one part of what that OTA revenue actually costs. OTA bookings cancel at nearly double the rate of direct bookings, which means a meaningful share of that $600,000 in booked OTA revenue was never going to show up in the first place.

Where to start

Before changing anything, look at where your bookings actually come from:

• What percentage of room revenue comes from each OTA
• What commission you’re paying each one
• How much revenue comes directly through your website
• What your booking engine and payment processing cost
• How much traffic your website receives
• How many of those visitors actually start or complete a booking

The last two matter most. If your website gets very little relevant traffic, improving the booking experience alone won’t solve the problem - you may need to work on search visibility, advertising, or other sources of qualified traffic first (our hotel website conversion benchmarks piece is a good place to see where your numbers stand). If the website already gets substantial traffic but very few visitors book, the problem is more likely the booking experience itself, and that’s a different fix entirely.

OTA commission isn’t inherently bad - it’s the price of accessing a distribution channel that provides real value. The problem appears when a hotel becomes so dependent on that channel that it has no realistic alternative. The long-term goal for an independent property is a direct channel that can stand alongside the OTAs: a website that’s easy to find, easy to use, gives guests a clear reason to book direct, and works properly on mobile. It’s less about removing OTAs from the picture and more about making sure you actually have a choice about where your bookings come from.

If you want a second opinion on what that mix could look like for your own property, that’s a conversation we have with hotel owners often - happy to talk it through.

If you want to take the next step, how to reduce OTA dependence covers the practical steps an independent hotel can take to shift more bookings toward its own website.